Are There Any Fees for Cancelling an E-Way Bill?

An e-way bill is a digital document that carries details of shipments of goods.  It is structured into two parts – one which mentions details of the supplier and recipient, value of goods, delivery location and invoice details while the other part mentions transporter details and vehicle number. E-way bills are mandatory for all shipments that are valued at over Rs. 50,000.

If you’re a business owner involved in the transportation of goods, you would certainly come across e-way bills. There are certain scenarios such as order cancellation, incorrect data due to data entry errors, or non-transportation of goods that may necessitate the cancellation of EWBs. A common question that you may encounter is whether there are any fees that you would need to pay for cancelling an EWB. Let’s explore this in detail and also understand the other implications of cancelling EWBs.

Is there any fee for cancelling an e-way bill

First off, let’s get straight to the point of this article. There are absolutely no fees or charges that you’d have to pay for cancelling an e-way bill. You can cancel EWBs for free as part of the compliance process. This is designed in such a way that businesses can easily make corrections and ensure accurate documentation.

Having said that, you may need to pay penalties if the cancellation of e-way bills is not done in accordance with the specified guidelines. Read on to learn more about the things that you need to keep in mind when cancelling e-way bills to avoid these penalties.

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Essential things to keep in mind when cancelling e-way bills

When cancelling e-way bills, there are a few things that you need to keep in mind in order to potentially secure your business from needless scrutiny or penalties. Here’s a quick run-through of these essential considerations:

1. Understand the timeframe for cancellation: E-way bills can only be cancelled within 24 hours from the time of generation of the bill. If you fail to do so by this deadline, the e-way bill will stay valid, and will result in a mismatch that could pop up during an audit or an inspection.
2. Avoid last-minute cancellations: If you wait close to the end of the deadline to cancel, you risk facing some technical glitches and/or portal downtime that could get in the way of the deadline to cancel. Hence a smart thing to do is to budget for these glitches and ensure you cancel well in advance.
3. Verify details before cancelling:Check the EWB details carefully before cancellation, so that you don’t cancel the wrong e-way bill by mistake. If you cancel the incorrect EWB, it remains permanently cancelled and the only way forward for you will be required to generate a fresh e-way bill.
4. Document the correct reason for cancellation:Selecting the correct reason for cancellation of an e-way bill is vital for maintaining transparent records and avoiding issues during audits. This is an especially critical consideration if you work at a business such as an online marketplace where plenty of shipments are handled on a daily basis.
5. Confirm cancellation on the portal: Never assume that the process of cancellation is complete just after you submit the cancellation. Instead, verify on the portal that the EWB status has been updated to ‘cancelled’. This is crucial to ensure that there are no active e-way bills that would show up during inspections or audits. This step protects your business from fines and helps maintain a clean compliance record.

Conclusion

To summarise, there are absolutely no fees that you’d need to pay for cancelling an e-way bill. So long as you act within the 24-hour cancellation window and follow the cancellation process, you can cancel an EWB for free on the portal. However, failure to comply with the process could lead to indirect costs such as fines, delays and scrutiny on the business. By understanding the EWB cancellation process and acting promptly, your business can stay compliant and this reputation for being compliant can be then leveraged into a strategic advantage when securing financing from NBFCs or banks.